Why PlayStation 2 still matters
Sony has cut the price of its PlayStation 2 console to under $99 in the US and 99 euros across mainland Europe, while it remains at £94 in the UK.
While rumours of a global Sony PlayStation announcement had circulated for days many observers were expecting the firm to announce a price cut for the PlayStation 3.
There is a continued belief that the high price of the PlayStation 3, relative to the Xbox 360 and Wii, coupled with the global downturn is causing ongoing problems for Sony as it battles to compete with Microsoft and Nintendo.
Sony, however, continues to point to its 10-year strategy for the PlayStation 3, and remains steadfast in its belief the platform will not only "come good" but will eventually triumph over the Xbox 360 in terms of global sales.
A look at how the PlayStation 2 has developed and evolved over the last nine years presents some clues as to why they believe this is the right strategy.
According to the last financials from Sony, the PS2 had sold 140.2 million worldwide (50.3 million of those in Europe and related territories like the Middle East and Australia) and 1,507.7million units of software.
And it continues to sell well across the world.
More than 5,000 PlayStation 2 consoles are sold each week in Japan, and last month 131,000 PS2s were sold in the US.
If you look at the software sales charts in the US it's clear the big developers are continuing to support the platform.
Pro Evolution Soccer 2009, Fifa 2009, Call of Duty: World at War, Need for Speed and Lego Batman are all riding high in the PS2 charts.
The top-selling game for PS2 at the moment does, however, give a sense of the target demographic for the console: Ben 10: Alien Force, a superhero game for young children.
So why is Sony cutting the cost of a PS2 and not PS3? Simple economics.
While sales of the PS2 are dwindling it continues to be a big money spinner for Sony, which is making money of each and every unit sold.
If Sony cuts the price of the PS3, on which it makes a loss on every console sold, it is likely to lose even more money in the short term.
Piers Harding-Rolls, a senior analyst at Screen Digest, told me: "Sony is looking to extend the life of the PS2 as long as possible to make up for the relatively slow adoption of the PS3.
"Indeed the PS2 remains a substantial source of income for Sony and will become increasingly relevant to emerging markets at this new price point."
This then is the reasoning behind David Reeves, boss of Sony Computer Entertainment Europe, when he comments: "We are very excited about the future of PlayStation 2 and will continue to grow the game library this year, meaning that new and existing owners have plenty to be excited about."
The PS2 is also "massive in emerging territories like India", according to a Sony representative.
More than 450,000 PS2 consoles have been reportedly sold in India since its launch.
"Worldwide PS2 software sales contributed €2bn of total value or 10% of the market in 2008 although it lost €1.5bn in value year-on-year as the platform hit the end years of its lifecycle," explained Mr Harding-Rolls.
It is by no means a device that has been consigned to the dustbin and if Sony is ever going to turn PlayStation 3 into a genuinely profitable enterprise it will to continue to squeeze all the revenue out of the PS2 that it can.
But as Mr Harding-Rolls warned: "Since the domination of the PS2 during the last console cycle, the market has been turned on its head by the incredible performance of Nintendo's Wii and the solid performance of Microsoft's Xbox 360 - it is clear that Sony's dominance will not be repeated this time round."







































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